- WTI struggles to maintain small intraday gains despite mixed underlying clues.
- The commodity is supported by hopes for a US-China trade accord as well as a weaker dollar.
- Oversupply concerns limit the black liquid’s growth and warn bulls to be cautious.
West Texas Intermediate (WTI) US Crude Oil prices struggled to capitalize on a slight intraday increase, sliding to a new daily low of roughly $58.00 during the first half of the European session on Friday. The commodity looks to have stalled its rebound from approximately $56.00, a three-week low hit on Thursday.
Hopes for a de-escalation of a fierce trade war between the United States and China, the world’s two largest economies, serve to alleviate fears about gasoline demand. Aside from that, US President Donald Trump’s threat to slap secondary penalties on any country that purchases Iranian oil appears to be a major element driving the black liquid. Furthermore, a minor USD decline from a multi-week high supports crude oil prices, though anticipation of additional OPEC+ supplies to the market limit the upside. Traders using modern prop firm technology are intently following these changes to make data-driven judgments in turbulent energy markets.
From a technical standpoint, the commodity was rejected last week around a horizontal support breakpoint, which has now transformed into a barrier near the $65.00 mark. The subsequent decline and negative oscillators on the daily chart support bearish traders, implying that Crude Oil prices will follow the path of least resistance to the downside.
However, a decisive break and daily close below the aforementioned mark could push Crude Oil prices down below the $57.00 round figure, perhaps retesting the overnight swing low near $56.60. On the other hand, momentum above the daily swing high, around $59.55, might spark a short-covering rally, allowing Crude Oil prices to retake the $60.00 psychological level. This is closely followed by the $61.00 round figure, which, if cleared, should pave the way for a move towards the $62.00 mark, then the $62.50 area, and finally the $63.00 round figure.